Former president Nelson Mandela and Thabo Mbeki, his
then-deputy, allegedly knew far more about the behind-the-scenes shenanigans in
the build-up to the arms deal*.

They allegedly knew a great deal more than either man has
previously stated about the negotiations and to-ings and fro-ings underlying the
arms deal as well as some of the actions taken by Durban businessman Schabir
Shaik.

Shaik and 11 of his companies are on trial in the Durban High
Court on charges of corruption and fraud. This includes the charge that Shaik
asked for a bribe of R500 000 a year for two years, for Deputy President Jacob
Zuma, from arms dealer Thomson (later called Thint).

The bribe was allegedly in exchange for Zuma's clout and
"protection" against arms deal investigations that, at that time, had
started to loom.

According to the "secret" forensic investigation into
Shaik and his companies, undertaken by KPMG on behalf of the National
Prosecuting Authority, Mandela and Mbeki were allegedly aware of many of the
complex lobbying efforts that Shaik is claimed to have initiated during 1997 to
1999.

The extent of the involvement of Mandela and Mbeki is just one
of the allegations in the Shaik matter that has not been revealed before.

These allegations are contained in the so-called
"secret", 260-page, KPMG The State versus Schabir Shaik and others:
Forensic Investigation (Draft Report on Our Factual Findings), dated April 28,
2004.

The report says: "It is apparent that there was involvement
at a high political level by Mbeki and Mandela to assist and advise on the
eventual structuring of the shareholding in African Defence Systems (ADS)"
and that "Mandela and Mbeki were involved in negotiations and discussions
during the period leading to the day when the cabinet approved the list of
bidders for supply in the Arms Deal."

According to the report, Shaik had wanted to ensure, first, that
the consortium with which he was involved would be a preferred bidder in the
arms deal. Later, he wanted to make certain that his company, Nkobi Holdings,
after it was sidelined in September 1999 owing to French-owned Thomson taking
full ownership of ADS, would be the acceptable "black empowerment"
partner in the consortium.

The Thomson group and ADS, two arms manufacturing companies, had
bid as partners - ADS was the local manufacturing company - for a contract to
make combat suites (electronic command and control systems) for corvettes naval
vessels that were part of the government's Strategic Defence Procurement
Packages. They thus formed part of the German Frigate Consortium (GFC).

The KPMG report was prepared for the National Prosecuting
Authority and is confidential.

Judging from the indictment against Shaik, the state's
"summary of substantial facts", and from certain graphics already
introduced in court, the report forms the substance of most of the state's case
against Shaik.

However, Billy Downer SC, the state prosecutor, has not yet
introduced the document in court as an exhibit and it is not known whether he
will introduce the information about Mbeki and Mandela.

Making an appearance in the report, in connection with Shaik and
Thomson's manoeuvring to be a preferred bidder, is someone referred to as the
"tailor" ("tailleur") by the Frenchmen in Thomson.

From the report this person appears to have been Yussuf Surtee,
a businessman involved in the clothing trade, with close connections to Mandela.

Tailor's pal

Mac Maharaj, former transport minister, is, according to the
report, referred to by the French as the "tailor's pal".

The report alleges that in September 1997 Pierre Moynot of
Thomson mentioned to his office in France "that Surtee did, in fact, appear
closer to Mandela than what his previous fax suggested".

The report alleges that in November 1997 Moynot again wrote to
his colleagues in an encrypted fax. Moynot is alleged to have written that the
"tailleur" had repeated that he had obtained assurance from the
then-deputy president that Thomson would be awarded the combat system and the
"sensors".

The report continues: "The deputy president of South Africa
at the time was Mbeki, who would also have been the chair of the ministers
committee that eventually took the final decision and made the final
recommendation to the cabinet."

In June 1998, the report alleges, information was received by
Thomson from a French ministry (it is not clear which one) that Mbeki was
ill-disposed towards Thomson in South Africa because he was in dispute with Zuma
and Shaik over which new black empowerment partners should be included in ADS -
he was allegedly not keen on Shaik's group - and because Mbeki was not friendly
with "the tailor".

According to the report, the French secret service was also
involved in aspects of the arms deal.

A note, translated from the French and dated April 3, 1998, is
headlined, "Unkind remarks to Thomson" and indicates that "the
French Secret Service had given information to the authorities (it is not clear
whether these were the South African or French ones) that Thomson "was
dealing" with the "tailor".

A second heading on the same note is "Visit to the
bank" and it reads that an appointment had been set with Mandela for April
26, 1998, but that an appointment with Mbeki and Joe Modise, former minister of
defence, would have to be requested in writing.

The total cost of the full acquisitions programme, announced in
May 1996, was projected to be R29.9 billion, of which the corvette programme,
one of six, was worth about R6 billion.